HSBC said in a statement Thursday that French magistrates ordered a formal criminal investigation (“mise en examen”) into HSBC’s Swiss Private Bank for alleged tax-related offenses.
The statement said bail of €1 billion ($1.075 billion) was imposed.
“HSBC Holdings plc believes the French magistrates’ decision is without legal basis and the bail is unwarranted and excessive,” the statement said. “It intends to appeal and will defend itself vigorously in any future proceedings.”
The conduct in question happened in 2006 and 2007, HSBC said.
In February, prosecutors in Switzerland searched the offices of HSBC’s private bank in Geneva. Prosecutor’s said they opened a criminal inquiry into possible money laundering against HSBC Private Bank (Suisse).
Hervé Falciani, a former HSBC employee in Switzerland in 2007, leaked documents that included the names of 130,000 account holders allegedly evading taxes in several countries.
The International Consortium of Investigative Journalists said in a report released in February this year that employees at the bank promised customers that their account information wouldn’t be released to tax authorities in their home countries.
HSBC Holdings plc is headquartered in London.
Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.